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Gratuity Amount Will Be Given Even After Leaving The Job Before 5 Years, The Government Is Preparing To Change The Rules

The central government is considering a change in the rules of gratuity payment for employees. Under this, the government is considering reducing the time limit of gratuity payment for employees from 5 years to between 1 and 3 years.

The Parliamentary Committee on Labor Affairs in its recently submitted report said that the eligibility deadline for gratuity payment should be reduced from 5 years to 1 year. Considering the constant demand to reduce the eligibility deadline for gratuity payment, this is being considered.

What is gratuity?

Gratuity paid to an employee is paid on a salary of 15 days per year, depending on the year of the employee’s work in the company. This payment is received only after the employee completes 5 consecutive years in a company. Usually, this amount is given when an employee leaves the job, is removed from the job or retires.

Which organization comes under the Act?

Any organization where 10 or more employees have worked on any one day during the last 12 months is covered under the Gratuity Payment Act. Once within the scope of the Act, the organization remains under the ambit of the Act forever, even if later the number of employees falls below 10.

Why the 5-year rule was made

The 5-year limit for gratuity was set so that people could work in the same company for a long time. But now the employees do not stop for 5 years in a company or institution given their growth. That is why it is being considered to reduce this period.

Apart from this, in the event of the death of an employee due to any reason or leaving his job due to illness or accident, he or his nominee gets the amount of gratuity. According to the rules of the Gratuity Payment Act 1972, the amount of gratuity can be up to a maximum of Rs 20 lakhs.

Parul Sharma
I am a media person with with an analytical writing approach. I write on Politics, Gender Issues and Economic Issues.


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